Insider's February Deal of the Month named
Midlands Business Insider editor Andy Coyne has selected the private equity-backed MBO of Stone-based Wells Plastics as February's Deal of the Month.
“Last month I plumped for an out of patch transaction to demonstrate the reach of Midlands dealmakers,” he said. “This month I make no apology for being parochial and selecting a deal that was signed, sealed and delivered in this region.”
The deal involved Birmingham-based private equity house Key Capital Partners (KCP) taking a £3.8m minority stake in the company as part of a “multi million pound” MBO. It has been sold to Paul Richardson (who will now become executive chairman), technical director Andrew Barclay and sales and marketing director Carl Birch.
Employing 42 people, Wells Plastics develops tailor-made solutions and technically advanced masterbatches for the polymer industry around the world. The company has achieved a sustainable 20 per cent annual growth rate over recent years, driven largely by the growth in demand for its innovative oxobiodegradable product Reverte.
The investment from KCP will help Wells to exploit the major growth opportunity for Reverte, with a particular focus on targeting the Middle East, Africa and South America, where rapid development is leading to increasing pressure on waste disposal management.
A wealth of Midlands advisers were involved in the deal. Beswicks Solicitors advised Wells; Clearwater Corporate Finance and Cobbetts advised the management team. KCP was advised on the transaction by BDO and Pinsent Masons. Senior debt facilities were provided by Natwest.
“It’s got all the making of a cracking local deal,” says Coyne. “Wells Plastics is that great thing: an innovative manufacturer. Its potential has been recognised by a local private equity house and its management team has bought into the firm’s future through the MBO.
“It is a multi-faceted deal transacted by Midlands advisers and amounts to a good news story for everyone involved.”
